by Barbara B. Pingrey
The Earned Income Tax Credit (EITC)—which is only available to those who work---was established by the federal government specifically to help lower and moderate income Americans. The credit is especially focused on workers with children, reducing the taxes they pay. A study by the Center on Budget and Policy Priorities found the poverty rate among children would be 25% higher without the EITC. Not only does it directly help families, but it also helps local communities. Experts estimate that money from tax refunds is recycled two to three times in the community, broadening the beneficial effect.
For over 20 years the Piton Foundation and its community partners have sought to help eligible workers access the EITC, 300,000 families in 2011. Also in 2011 nine community colleges and three four- year colleges, including the University of Colorado in Boulder, assisted 6,000 low-income taxpayers at 20 sites file their tax returns for free. Trained college students take a special accredited course for IRS certification and then operate a free tax preparation service for which they receive college credit. More information about this part of the program can be found at piton.org/taxhelpcolorado.
The most recent year for which the IRS has released statistics showed Boulder County with 12,904 recipients receiving refunds totaling $19,340,000 and Broomfield County with 1,711 taxpayers’ refunds totaling $2,945,000.
But the benefits do not stop with the tax refund. They are multiplied throughout the community by promoting work, helping low-income families build assets to weather economic storms, reducing poverty and reducing income inequality. The EITC is not a hand out, it is a hand up based on the individual’s own earned income. It is the community coming together to help support those who are working to sustain their families. It is LIVE UNITED in action!
Barbara B. Pingrey is the President and CEO of Foothills United Way
